By Prof. Aparajith Ramnath

Facebook’s plans to build a 394-flat residential complex for its staff in California, and the ensuing discussions in the media, raise an interesting historical question. Why do companies set up townships?

There are strategic reasons: the seventeenth-century walled cities of Fort St. George (Madras) and Fort William (Calcutta) were established by the East India Company as trading outposts, racially exclusive enclaves for its functionaries, and barracks for its troops.

Logistics also play a part: around a century ago, the township of Jamshedpur was built to house the employees of the Tata Iron and Steel Company (TISCO), as the ideal site for the works (close to iron ore, coal deposits and running water) was far from any urban centre.

But history also suggests that companies set up townships to streamline their workforces. A recent study shows that the immigrant workers pouring into the Ford Motor Company in the early twentieth century were encouraged to leave their allegedly squalid ethnic settlements in nearby Detroit and move into company-organised housing in Dearborn, Michigan (where Ford had its plant). They were put to school to learn English and dissolve their ethnic identities as far as possible, thus becoming American.

In Jamshedpur, ingenious techniques were used to promote efficiency. In his 1943 memoir, John Keenan, an early General Manager of TISCO, recounts how a race course was created to channel the energies of the steel operators. Earlier they used to disappear to the nearest city for a flutter on their days off; now, ‘[w]ith racing in their own backyard … the boys stayed at home and made steel. And as the output of steel increased, wages rose and big bonuses became the order of the day … Heavy drinking ceased.’

Townships also tend to reinforce, subtly or otherwise, the hierarchies of the workplace. A colleague who grew up in an Indian mining township in the 1970s and ’80s recalls that the distinction between ‘officers’ and ‘workers’ was expressed in many ways: not only did they have separate recreation clubs; their children went to the same schools in separate buses.

But do such objectives still hold true in the age of flat organisations, open-plan workplaces and air-conditioned offices? Yes, albeit in modified form. They may not be residential, but anybody who has worked in the IT ‘campuses’ of Bangalore, Chennai or California is familiar with the feeling of being in a world within a world. Whether by design or otherwise, catering, comfortable lounges, and facilities for sport and leisure encourage the twenty-first-century employee to extend his or her hours at work. Some companies take day-to-day errands, like paying utility bills, off employees’ hands; others provide washing machines at work; yet others clean employees’ homes for free. In this context, we may conclude that developments like Facebook’s proposed residential complex would not represent a major change. They would only confirm what is already true: that the company continues to loom large in the life of the employee, whether in the knowledge economy or the industrial.